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Mexico outlines details of cross-border trucking pact

By the CNN Wire Staff
The trucking deal closes a debate that started with the North American Free Trade Agreement.
The trucking deal closes a debate that started with the North American Free Trade Agreement.
STORY HIGHLIGHTS
  • Obama and Calderon announced the agreement last week
  • It comes after 16 years of disputes
  • Mexico truckers would go through three phases before authorization
RELATED TOPICS
  • Mexico
  • Trade Policy

Mexico City (CNN) -- Mexican officials are revealing details of a recently announced agreement that ends a 16-year trucking dispute between Mexico and the United States.

U.S. President Barack Obama and Mexican President Felipe Calderon announced the agreement during a visit by the Mexican leader to Washington last week.

The two leaders solved what had been a wrench in the gears of the North American Free Trade Agreement, which was signed in 1994. Under the agreement, U.S. and Mexican tractor-trailers were to be allowed to transport goods back-and-forth across the border beginning in 1995. But safety and security concerns spurred the United States to bar Mexican trucks on U.S. roadways.

In response, Mexico retaliated with $2.5 billion in tariffs on a variety of U.S. goods.

A pilot program in 2007 to get Mexican trucks on U.S. roads was de-funded.

This time, Mexican officials said, in details that began to emerge over the weekend, the authorizations will be permanent.

Unlike the failed pilot program, under the new plan there will be no limit to the number of companies who can participate and the trucks they can register for cross-border transport, said Dionisio Perez-Jacome, Mexico's Communications and Transportation Minister.

There will be three phases to the program, he said.

The first will be the application and inspection of Mexican trucks and the accreditation of their operators, Perez-Jacome said. This phase concludes with a provisional authorization being granted to enter the United States.

The second phase starts with a three-month period of thorough inspections of the vehicles crossing the border, checks that will decrease starting the fourth month, he said. It concludes with a certification that the company is following all the rules.

The last phase involves the Mexican companies being notified of their permanent authorization, which can be granted after 18 months of successful operations, Perez-Jacome said. This authorization can only be revoked if a safety regulation is broken.

A binational commission will be created to monitor all the phases of the new program.

"This is a great step forward in our bilateral relations," Mexican Economy Minister Bruno Ferrari said. "The solution to this conflict represents a substantial advance for regional competitiveness, and, without a doubt, will offer new business opportunities for Mexican truckers."

Currently, three trucks and three drivers are used to get goods across the border, Ferrari said. It comes out to about $150 per crossing. Multiplied by the 4.5 million annual truck crossings, the savings generated could exceed $675 million, he said.

The agreement is expected to be signed by both presidents by June, at which time Mexico will drop half of its retaliatory tariffs, Ferrari said. The second half will be removed when the first permit for Mexican truckers is issued.

However, Ferrari noted, Mexico reserves the right to re-introduce tariffs if any parts of the agreement are violated by the United States.

Some in Mexico expressed concern that the U.S. Congress may block the agreement. Ferrari said that his understanding was that Obama was asking for a consultation period that would include Congress, but that the legislative body's approval would not be required.

The flow of goods across the border exceeded $2.75 billion in 2010, which represents 70% of total trade between Mexico and the United States, Ferrari said.

"The agreement achieved will reduce the costs of transporting goods between both nations," he said.

 
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